Posts Tagged ‘Beijing’

First Russia, and now China. The US is being firmly put in its place by the emerging superpowers in the world. First it was President Putin standing up to Obama over Syria in 2013. Then again in early 2014, Putin stood up to the US sanctions. Now China has sent a sharp official message to the US, warning it to stop meddling.

A return to the gold standard in any form is nowhere on anybody’s horizon. It has few supporters in today’s virtually universal embrace of fiat currencies & floating exchange rates. Yet gold has special properties that no other currency can claim. For more than two millennia, gold has had virtually unquestioned acceptance as payment.

China is happy to provide the financing to turn Africa into Disneyland – Monorails & all – but there is one catch… the loans must be backed by gold as collateral, in accordance with rules & regulations when granting any loan. Great way for China to transform its excess USDs to Gold (Also get paid interest while it waits).

On one hand China has been allowing the world to glimpse its ravenous buying of gold through Hong Kong since Hong Kong customs provides a full breakdown of how much gold it exports into China, yet on the other the PBOC has refused to update its official gold holdings in exactly five years.

A new era is dawning in Chinese foreign policy as it’s economic growth enables it to move from past timorousness in declaring itself a global leader & a relative inability to defend its interests, to one in which Beijing can seek adjustments in the security environment it has faced for the last sixty years.

This is indeed silly games. Until anyone in the mainland can take money freely in and out of the country, the yuan remains officially defined as funny money. There is no such thing as “normal” in the yuan exchange rate. Normal market forces do not determine it.

Brewing conflicts, especially regarding the state of affairs in East Asia, will soon replace economic problems as the center of the world’s attention, including in the investment markets – People who are threatened by these conflicts start looking for safety for themselves, their families & their money.

While Beijing struggles to reduce its air pollution there is another technology close to commercial production that will eliminate vehicle emissions all together, again using a healthy amount of PGM’s – Catalytic converters will play a major role in the global push to improve air quality.